At first glance, the news that Spotify has bought The Ringer looks like good news, doesn’t it?
A journalist, after the closure of the ESPN website he used to work for, builds his own site and podcast network that he’s able to sell on for a very healthy amount of cash. This is a good news story, right?
Well, it’s certainly good news for Bill Simmons, who will be millions richer. But for journalism as a whole? It might well be less good news, and the beginning of another challenge to an emergent business model. People are fighting to take control of podcasting, and Spotify might be well placed to own the medium.
Kevin Anderson commented in his newsletter that consolidation seems to be happening more quickly in this space than others:
It appears to me that this roll-up - consolidation being a major trend in media - is happening earlier and at a much faster rate than we have seen in the past.
He’s right - and it makes sense. There are logistical gains in combining the production costs and ad sales opportunity in large podcast networks. Spotify has been particularly acquisitive, first buying Gimlet, a popular podcast network, and then Anchor, a lightweight tool for creating podcasts on mobile.
Shifting from music costs to podcast revenue
There’s a lot of financial sense in Spotify encouraging users of its app to play podcasts, too. Every music stream it plays costs it money in licensing fees. Potentially every podcast stream makes it more, though advertising, while diverting subscriber listening time away from generating more costs.
Ben Thompson wrote about this a year ago:
[…] for Spotify podcasts are fixed costs: that means that driving more listening flows directly to the company’s bottom line in a way that increased music listening does not. This is a very big deal — it is entirely possible that if Spotify succeeds in the space that podcasts will drive a relatively small percentage of revenue and a much larger percentage of profit.
But here’s the other problem - Spotify is slowly pulling new “podcasts” into its app exclusively. New launches from Gimlet Media have been Spotify exclusives, and it’s getting big names to create content behind its paywall. The Ringer is already producing Spotify exclusives. And that means they’re not actually podcasts at all, technically speaking — and we should be worried about that.
What is a podcast?
Why? Well, one of the things that makes podcasting stand out at the moment is that it is an open standard. Nobody controls it. We can publish podcasts and our audience can subscribe in anyway they choose. This is because of the technological underpinnings of the medium.
Here’s where we get technical.
A podcast is just an audio file delivered as an enclosure via an RSS feed. (For those who don’t know what they are, one of my students wrote an excellent explainer on RSS recently).
That means that they can be subscribed to an any app that can understand those feeds, check them for updates and download and play the file. While you can use Apple’s Podcasts app, or the Google equivalent, you can also download any number of independent podcasts apps, and subscribe to any podcast you like in that. I, personally, use an app called Overcast, for a number of reasons, not least that it allows me to do things like this:
Wannabe Podcasting Gatekeepers
The point here is that there is no gatekeeper in podcasting. At a time when we’re beset by the gatekeeper duopoly of Google and Facebook, that’s something we should fight to preserve.
Apple has been the closest we’ve had, with its iTunes Podcast directory (now spun off separately) long the default place you needed to be. Apple, though, has been a good steward of this power, not attempting to lock up podcasting to its own specifications. There are — at the moment, at least — no Apple exclusives, only available in their own app. And, despite rumours to the contrary, none have emerged. (It seems likely now that the rumours were about podcasts supporting Apple TV+ shows.)
Podcasting has no gatekeepers, in the way that search and social have had.
Many people in the tech world are looking at that and seeing an opportunity in becoming that gatekeeper. And we should be very careful before we let that happen.
Actually, no, that’s wrong. We should do everything in our combined power as journalists and publishers to stop that happening, lest we find ourselves saddled with another Facebook.
It took less than a day for Luminary to become enemy number one of the podcast industry. Last month, on the same day that it unveiled its subscription podcast service, the company tweeted a typed-out image of a bunny holding a sign: “Podcasts don’t need ads.” Fans of the famously ad-supported industry revolted.
It could be used as a standard podcast player (“podcatcher” as we called them back in the mid-2000s), or as an app to access the exclusive content with a subscription. In essence, they were trying to be the Netflix of podcasts. They don’t appear to have gained much traction, despite launching on Alexa-powered devices at the title end of last year.
Spotify wants to dominate podcasting
Spotify is walking the same path. Now that Spotify is both growing the podcast market AND providing its own exclusives, it is starting to assume the role of a gatekeeper. If Spotify becomes the dominant force in podcasting, and the public associate the medium with it, then we have a new set of challenges on our hands, because the company can start dictating the terms on which we appear in the app. And if we don’t appear in the dominant app, many of the advantages of podcasting evaporate.
If this seems far-fetched, remember that Facebook essentially just took a bunch of tech you could already find on the web — blogging, friends lists, photo hosting — and pulled them together in a way that made it the gatekeeper of our attention.
Indeed, there are plenty of grounds to worry already. The BBC, once a good podcasting ecosystem player, is pumping more and more effort into its BBC Sounds app, and away from neutral podcast delivery. Thankfully, it hasn’t stop delivering its shows as conventional podcasts, but it is no longer educating the public about podcasting. It’s sending them to its own app instead.
Continued fragmentation of the podcasting landscape would be very bad news for us. Podcasting is great for journalism on a number of levels:
- It’s a secondary activity for listeners, meaning it can extend into parts of their life other content can’t
- It allows deep immersion in reporting
- We can make money through sponsorship
- If delivered on a regular schedule, it becomes habit forming, and a routine part of their media lives
- It’s an unmediated relationship between us and out audience
The last of those is under threat — and we’d be foolish to ignore it. Time to start educating your readers about the range of podcasting apps out there, perhaps — before it’s too late.